Seeking Alpha


Send Message
View as an RSS Feed
View marpy's Comments BY TICKER:
Latest  |  Highest rated
  • ArcelorMittal: Why I Hold What I Hold [View article]
    i am long MT recently bought in near current price. There are considerable one time charges in the first half of the year results (to the tune of around 400 million). This in itself tells you that the future should be better all things being equal.
    MT because of their world wide presence is in a unique situation that IMO gives them some good advantages. The purchase of Thyssens Atlantic sea board plant is an example (cost Thyssen 14 billion to build - bought by MT and partner for 1.5 billion). It made no sense for Thyssen because it was dependent on Brazilian slab which went from being among the cheapest in the world to among the most expensive. It makes a lot of sense for MT as they can source slab from many different places. My understanding is that under MT this plant is improving with operating rates approaching 80% and IMO it will be quit profitable for MT.
    They have used the slow down in the steel market to rationalize operations throughout the world, cut costs and make selective investments at attractive prices. These actions should reap considerable rewards going forward. JMO
    Aug 5 10:05 AM | 1 Like Like |Link to Comment
  • ArcelorMittal: Why I Hold What I Hold [View article]
    Note that Iron ore makes up only about 10% of its business and in MT's case a lot of it goes to feed its own operations. Iron ore does have an impact on MT but not as much as the market would like to think. JMO
    Aug 5 09:55 AM | 2 Likes Like |Link to Comment
  • ArcelorMittal's (MT) CEO Lakshmi Mittal on Q2 2014 Results - Earnings Call Transcript [View article]
    I would not hold "Cautiously Optimistic" against him in any way or read anything into it other than it being a politically correct term that will keep the company out of court.
    They had a number of 1 time items that impacted them negatively to the tune of around 400 million and so this tells me the next quarter should be far better. They also got a very good deal on the operation they bought on the Atlantic sea board (cost 14 billion to build and bought for 1.5 billion) which they seem to be making good progress on. They have made good progress on rationalizing the European operations and also have a number of strategic projects in the works through out their global operations.
    While the rest of the industry battened down the hatches and tried to ride the slow down out, MT used it as an opportunity to streamline operations, cut costs, buy assets at fire sale prices and build a better company.
    I used yesterdays share price drop to increase my position by 30% near the lows and if it continues south in the weeks ahead will buy more.
    They are the worlds biggest steel company with synergies, a large research department, and some world class steel plants others can only dream of. Yes I know that they also have some pretty run down operations (especially in the USA) as well but they have far more strengths than weaknesses.

    Aug 2 12:22 PM | 1 Like Like |Link to Comment
  • An End To Our Relationship With Yahoo, A New Era For Equity Research [View article]
    I never used Yahoo and visit SA on a daily basis. Yahoo is very main stream and you can get that info anywhere. SA is unique in many ways with some very good authors. JMO
    Aug 2 08:46 AM | 5 Likes Like |Link to Comment
  • Falling steel prices will hurt earnings, ArcelorMittal warns [View news story]
    The headline is misleading - read the articles to find out what they really said. Anyway - picked up some more near the low today. Worlds largest steel company with lots on the go in terms of projects and managing costs. They own the best mills in North America and have been using the slowdown over the past few years to their advantage in restructuring the European operation and making strategic purchases. IMO - should provide a very good return going forward.
    Aug 1 09:15 PM | 1 Like Like |Link to Comment
  • TransCanada expects to file for Energy East pipeline permit by August [View news story]
    Alberta can produce enough oil to keep Keystone, Energy East and Enbridge's pipeline to the west coast full so I say bring it on!!! This will be the least politically sensitive pipeline as all the provinces to the east have more or less said they support it. Mind you, i suspect that the green clowns from BC and the US will be moving their noise making and junk science East and North.
    Jul 30 04:13 PM | 2 Likes Like |Link to Comment
  • Will Turquoise Hill's Time Ever Come? [View article]
    Nice article Gary.

    IMO - The biggest problem with TRQ is the GOM which has shown to be very inconsistent with its policies and does not seem to want to honor its contracts. The GOM's actions have caused the Mongolian economy to tank and the currency to drop as foriegn investors stay away. Rio Tinto is a very large well experienced miner and if they can not make a world class project work in Mongolia then most other companies would not have a snow balls chance in hell. This mine when fully developed will be huge part of the Mongolian economy and would be responsible for 30% of Mongolian GDP. It may take till the next election in 2016 for this to get sorted out as the current government has made zero progress and in many ways has actually gone backwards (phase 2 is on hold and the tax dispute is headed for arbitration).
    The agreement was negotiated by the previous government (MPRP) after over 2 years of negotiations and consultation with many world class mining and financial experts and is viewed by most as a very good agreement all around for all parties. The problems started when the DP won the last election with a minority and rather than form a coalition with the MPRP (as had been done previously) decided to form a coalition with some of the more radical nationalistic parties. The resource minister is a member of one of these other parties and a stanch unapologetic resource nationalist.
    Rio Tinto's Sam Walsh has been very clear on where Rio Tinto stands stating that Rio Tinto expects its projects to be profitable through all stages of a resource cycle and that Rio Tinto invested with a long term view and needed stable government policy and frame work. (not his exact words but close enough).
    My read is that the people of Mongolia are getting tired of paying the economic price for the GOM's incompetence and that if things do not change soon the DP and its partners will not do well come next election and we should hopefully see a more business friendly government.
    As for Mongolia nationalizing the mine, you can never say never but it does not make a lot of sense for the following reasons
    1) Mongolia does not have the expertise to run or build such an operation as the underground (80% of value) requires block caving technology and only the top miners on the planet can do this efficiently.
    2) Nationalization would mean that Mongolia would be relying on the Russians or Chinese to operate this mine - Something Mongolia and its people are not keen on.
    3) The agreement the mine was built under is a very strong and comprehensive agreement enforceable in international courts and so nationalization would be a very expensive proposition for Mongolia that would take generations to pay off. 50 billion in compensation to Rio Tinto and the minority shareholder would not IMO be an unreasonable number.

    What we have here amounts to a huge world class deposit with a huge payoff for all parties involved including the people of Mongolia when things finally get sorted out. The biggest looser currently are the people of Mongolia who are paying the economic price for the GOM's actions and incompetence.

    Jul 29 08:39 AM | 6 Likes Like |Link to Comment
  • Bank Of Montreal Faces A Challenging Canadian Environment [View article]
    A couple of corrections for you - BMO has owned Harris Bank of Chicago for something like 25 years - it is not a new acquisition. Those buying BMO or any other Canadian bank right after the 2008 crash would have suffered for a while before seeing a turn around. In BMO's case they went from around $60 down to around $30 before things started getting better.

    Is it a good investment at current levels?? It all depends on what the Canadian economy does and to a lesser extent the US economy does going forward.
    Jul 21 03:29 PM | 1 Like Like |Link to Comment
  • Colorado governor, oil companies hope to thwart drilling ballot measures [View news story]
    30 billion a year - that has to be a big piece of the states economy. Lots of jobs including many that have little to do with oil and gas would disappear and a lot of tax revenue would be lost. I can see why the governor is concerned. The average citizen that has to work for a living should be as well.
    Jul 18 07:29 PM | 7 Likes Like |Link to Comment
  • Report: Encana planning to sell Deep Panuke gas project [View news story]
    Based on the big cash cow that Deep Panuke is, the price tag better be 2 billion plus and even at that, the market may not be happy. This is an asset that unless they get top dollar is better kept.

    Jul 18 02:43 PM | Likes Like |Link to Comment
  • Canadian Century Club Dividend Stocks [View article]
    Can you even consider the so called U.S. banks as banks anymore?? So much of their business comes from financial businesses that are not traditional banking and come with higher risks. They are IMO large financial conglomerates that do some traditional banking.

    Jul 18 11:35 AM | Likes Like |Link to Comment
  • Canadian Century Club Dividend Stocks [View article]
    There is definitely something to be said for a Canadian style banking system ( economically conservative leaning, relatively big and well regulated). A strong banking system is the key and backbone of any economy and Canada proved this during the last crash.
    Jul 18 11:30 AM | 3 Likes Like |Link to Comment
  • Canadian Century Club Dividend Stocks [View article]
    I for some time have had a considerable portion of my portfolio in Canadian financials including banks. The indicators I watch for is the health of the real estate market, energy market (oil and gas) and interest rates. Canada's economy is overly dependent on the first two and so as long as they do well, the economy and the banks should do well. Any signs of deterioration in these indicators or economics affecting them and I will be selling all that I own. The Canadian banks are in fairly good shape and so should survive any correction but their earnings and share price will be impacted negatively and so cash will be the place to be. US dollars may also look good as a correction will put the Canadian dollar under pressure.

    Jul 18 11:26 AM | Likes Like |Link to Comment
  • Turquoise Hill says Oyu Tolgoi concentrate output returns to normal rates [View news story]
    GOM is still being a thorn in the side of TRQ and Rio Tinto. Rio Tinto has put phase 2 on hold and initiated arbitration proceedings due to tax issues with the GOM. Phase 2 is the underground development that unlocks 80% of the deposits value. TRQ has huge potential but the way things are going with the current GOM, investors may have to wait till after the next election in 2016 before they see any results.

    Jul 15 09:26 PM | Likes Like |Link to Comment
  • General Electric: Helping Clean Up The Canadian Oil Sands [View article]
    GE smells money in the oil sands - its as simple as that. As for the oil sands being dirty - They are no where as dirty as people think. The average is around 14% more green house gas emissions than conventional production and getting better all the time as the industry itself has many initiatives to improve environmental performance in the works. Its heavy oil and heavy oils in general regardless of where they come from result in more green house gas when produced. The real bad boy when it comes to green house gas is actually coal which is way worse than oil.
    Jul 14 02:11 PM | 3 Likes Like |Link to Comment